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On Tuesday, Cantor Fitzgerald adjusted its outlook on Riot Platforms (NASDAQ:RIOT), reducing the price target to $21 from the previous $23, while maintaining an Overweight rating on the company’s shares. Currently trading at $9.39, the stock sits between its 52-week range of $6.36 to $18.36, with InvestingPro analysis indicating the stock is currently undervalued. The adjustment follows Riot Platforms’ reported Bitcoin mining revenue for the fourth quarter of 2024, which showed a significant year-over-year increase.
Riot Platforms experienced a 105% year-over-year surge in Bitcoin mining revenue during the last quarter of 2024, amounting to $123 million. This increase was attributed to a higher average price of Bitcoin mined, which climbed to $81,234 from $36,815, despite a decrease in the number of Bitcoin mined to 1,516 from 1,630 in the same period. According to InvestingPro data, the company maintains strong financial health with a current ratio of 5.68 and holds more cash than debt on its balance sheet.
The analyst from Cantor Fitzgerald anticipates continued revenue growth for Riot Platforms in the upcoming quarters. The expectations are based on comparisons with the previous year’s corresponding quarters. The installed hash rate, which is a measure of the computational power used to mine Bitcoin, is projected to average 33.9 EH/s in the first quarter of 2025, a significant rise from 12.4 EH/s in the first quarter of 2024. Similarly, for the second quarter of 2025, the installed hash rate is expected to average 36.1 EH/s, up from 16.4 EH/s in the second quarter of 2024.
The firm’s outlook is further bolstered by the current Bitcoin prices, which are hovering around $100,000. Cantor Fitzgerald’s analysis suggests that the cryptocurrency bull market could persist for another 12 to 16 months, potentially leading to sustained high revenue from Bitcoin mining for Riot Platforms. With a market capitalization of $3.09 billion and analysts projecting 33% revenue growth for 2024, the company shows promising potential. For deeper insights into Riot Platform’s financial health and growth prospects, including 12 additional exclusive ProTips, check out the comprehensive research report available on InvestingPro.
In other recent news, Riot Platforms reported a robust financial performance for the fourth quarter of 2024, with a 34% increase in total revenue, reaching $376.7 million. The company’s net income turned positive, amounting to $109.4 million, marking a significant turnaround from a net loss the previous year. Bitcoin mining revenue surged by 70% to $321 million, while the company’s operational capacity grew by 154% year-over-year. H.C. Wainwright maintained its Buy rating for Riot Platforms, with a price target of $17.00, reflecting confidence in the company’s strategic direction and balance sheet strength.
Riot Platforms also announced plans to increase its hash rate to 38 exahashes per second by the end of 2025. The company is exploring high-performance computing (HPC) and artificial intelligence (AI) opportunities, particularly at its Corsicana, Texas facility, which could host AI-focused data centers. Needham adjusted Riot Platforms’ price target to $13.50, while maintaining a Buy rating, citing ongoing industry challenges such as weak bitcoin prices and high global hash rates. Despite these challenges, Needham expressed optimism about the potential of Riot’s Corsicana site for AI and HPC applications.
Riot Platforms’ strategic pivot towards AI and HPC reflects its agility in adapting to technological changes. The company is actively seeking partnerships and has engaged financial advisors to optimize its market positioning. With a strong balance sheet and a focus on expanding its power capacity, Riot Platforms aims to capitalize on the growing demand for AI and HPC services.
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